Xiaomi is closing in on Samsung in India's top smartphone market share

The rise of Beijing-headquartered Xiaomi — it posted $1 billion in revenue from India in 2016, within three years of its launch in this market.

NEW DELHI: Samsung’s four-anda-half-year reign at the top of India’s smartphone rankings is under threat, with China’s Xiaomi ending the quarter through September almost side by side with the South Korean market leader. The July-September period also saw the return of Nokia in the reckoning for the top spot in feature phones. The brand, now owned by HMD Global, climbed to the No 4 spot with an 8% market share within a quarter of its commercial launch, analysts at Counterpoint Research said.

In smartphone market share, the difference between Samsung and Xiaomi was a mere half percentage point in the past quarter, Counterpoint said, citing preliminary data. The Hong Kong-based research firm estimates industry shipments in the quarter to have risen 13 per cent from a year earlier and 32 per cent sequentially to an all-time high of 40 million units. “Xiaomi had a 22.3 per cent share in the quarter ended September, while Samsung had a 22.8 per cent share by volume,” associate director Tarun Pathak told ET. The Chinese brand grew nearly four-fold from a year earlier, driven by the Redmi Note 4 model which is the top-selling model in India since January, he said.

CMR termed the gap between Samsung and Xiaomi as “minuscule”. The research house has yet to release the numbers for the past quarter, but for July-August, it estimates Samsung’s India smartphone share at 21.4 per cent, a tad above Xiaomi’s 20.8 per cent. IDC didn’t comment on the market share for the quarter, but sources within the research firm said the two rivals were neck and neck.

Samsung and Xiaomi didn’t respond to emails seeking comment. The rise of Beijing-headquartered Xiaomi — it posted $1 billion in revenue from India in 2016, within three years of its launch in this market — has been on the back of its strategy to give high-quality, high-specification phones at half the price of competitors. “That is our philosophy,” Manu Jain, Xioami’s head of India operations, said in an interview to ET earlier this month.

While the company sold its products exclusively through online platforms in the first two years, its offline entry with partners and through its own Mi Home stores has propelled the brand’s popularity and sales manifold. On the prospects of Xiaomi overtaking Samsung, the market leader since March 2012, Pathak said: “It will be neck and neck ... quite possible in one of the months, but to be a leader for a longer period of time, Xiaomi needs significant investment in offline space with portfolio across different price bands.”

According to data with ET, Xiaomi’s smartphone market share was just 6.4 per cent in the quarter ended September 30 last year, when its ranking was fifth. Samsung at the time had 22.6 per cent of the market. A quarter later, the Chinese company’s market share rose to 9 per cent, and it climbed two notches up in the ranking. In January-March this year, Xioami was No 2 with a 13 per cent share, compared with Samsung’s 26 per cent. Chinese players — Xioami, Vivo, Oppo and Lenovo — put together appear to have taken share away from Samsung, which ended the quarter through June with a 24.1 per cent share, ahead of Xiaomi’s 15.5 per cent. For the quarter through September, Vivo was the No 3 player in the smartphone segment with a 9.5 per cent share, according to Counterpoint’s findings, followed by Oppo with an 8.5 per cent share. Both have expanded their market share by more than twofold in the past year. While Samsung has lost some market share, these Chinese brands have gained mostly at the cost of small players, analysts said.

On the record shipments last quarter, Counterpoint said this was primarily due to brands pushing stock into channels to tap the festive demand. However, industry insiders said sales weren’t as strong as expected. Samsung, which last week reported a record profit globally, is facing threat in the featurephone segment with Nokia’s return.